Offshore Petroleum Licensing Bill

Jim Shannon Excerpts

Committee of the whole House
Tuesday 20th February 2024 Commons Chamber

[Graham Stuart]

The hon. Lady may not have been present for the previous stage of this Bill, but as she has been present for other debates in this House, I cannot claim that she is an absentee Member, so it is extraordinary that she is unaware of the amazing transformation in insulation in this country since 2010. Is she not aware that, in 2010, just 14% of homes were decently insulated? Today, the figure is well over 50%. We are spending £6.5 billion in this Parliament, and will commit another £6 billion between 2025 and 2028, precisely to deliver the transformation that she calls for. On top of that, we have the eco schemes, and obligations on industry. That is how we have taken ourselves from the parlous, shameful situation left behind by the Labour party in 2010 to one where, although there is still much more to do, 50% of homes are decently insulated.

[Jim Shannon (Strangford) (DUP)]

The Minister was very kind to come to my constituency in Northern Ireland to look at the potential schemes for sea turbines and the contract for difference arrangements. At the time, he indicated that, whenever the Assembly was up and running, the contract for difference scheme would be the responsibility of the Northern Ireland Assembly. He was very keen and eager to assist the Assembly. Is it his intention to contact the Northern Ireland Assembly to ensure that the CfD scheme can be promoted? His input into that will make a big difference.

[Graham Stuart]

I thank the hon. Gentleman, who is a consistent champion not only for his constituents but for the clean transition. I look forward to meeting and working with the new Minister for the Economy, who I believe has the energy portfolio in Northern Ireland.

The Bill will give industry the certainty that it needs to continue investing in the North sea, to strengthen our energy security, and to support the transition to net zero. The Government’s position is clear: we should, as far as possible, seek to meet continued UK demand for oil and gas from the UK’s own sources. That means continuing to use the North sea—a UK success story that has contributed billions of pounds in tax revenue and supports an industry of around 200,000 workers. The oil and gas industry, with its strong supply chains, expertise and skills, is vital to driving forward the net zero transition and the investment in clean technologies that we need to meet our net zero targets.

We all want the energy transition delivered in an orderly way that does not risk thousands of those jobs. Artificially reducing our production from the North sea or banning new licensing would do just that and jeopardise the energy transition, our progress towards net zero and our climate leadership, not to mention the billions of pounds in lost tax revenue. The Bill is about ensuring a smooth and orderly transition. New licences awarded under the Bill will manage the decline in domestic oil and gas production, rather than increase production above current levels, and they will give industry certainty by sending a strong signal of support for continued investment in the sector—investment that is necessary both for our energy security and to help deliver the energy transition. I commend the Bill to the House.

Civil Nuclear Road Map and Wylfa

Jim Shannon Excerpts

Tuesday 23rd January 2024 Westminster Hall

[Virginia Crosbie (Ynys Môn) (Con)]

I beg to move,

That this House has considered the civil nuclear roadmap and Wylfa.

It is an absolute privilege to speak in this debate on the civil nuclear road map and Wylfa. I secured this debate to highlight the simple truth that large-scale nuclear development at Wylfa in my constituency of Ynys Môn would be a transformational opportunity for the people I represent. It would be the largest inward investment in the history of Wales, and potentially the greatest single action the UK could take in the fight against climate change and in the race for energy security.

I warmly welcome the civil nuclear road map that the UK Government published recently, in which they committed to exploring a third gigawatt-scale project after Sizewell C, and to developing further large-scale nuclear in parallel with small module reactors. I urge the Government to take that commitment further by naming Wylfa as the site for such a large-scale project, and to move forward at speed in announcing a partner to deliver that project in Ynys Môn. I am in no doubt, and neither is the nuclear industry, that Wylfa is the best site in the UK—and indeed all of Europe—for new large-scale nuclear.

I was recently visited by a delegation from Korea. That country has 24 GW of nuclear capacity, and the delegation said that Wylfa was a better site for new nuclear then any site they have. Why is that? Well, we have an existing strong connection to the national grid, we have solid bedrock—ideal for pouring the foundations of a nuclear power station—and we have plentiful cooling water that is deep, cold and close, which is exactly what the engineers need. We also have a site that has been substantially cleared and prepared for large-scale construction by Horizon Nuclear Power, under Hitachi. The industry opinion is unanimous: a third large-scale project must be at Wylfa, and I hope the Government will listen to that advice. Will the Minister commit today, or in the coming weeks, to naming Wylfa as the site for a further large-scale project?

There is one more factor that makes Wylfa ideal for new nuclear, and that is the strong support of the local community. Wylfa means hope—the community remembers what the island was like when the original Wylfa was up and running. To them, nuclear means jobs, investment and opportunity for them, their children, and their Welsh language—for all the young people who otherwise leave the island to find good work.

[Jim Shannon (Strangford) (DUP)]

I am very impressed by the hon. Lady’s bringing forward this debate. From the beginning, she has been very assiduous in the House on this issue. My knowledge of her dates from her first debate in this House, which I think had a similar focus and title. I envy her for having a nuclear site where she wants it. We wish to have the same in Northern Ireland, but it is not possible. Does the hon. Lady agree that jobs should be created right across the United Kingdom of Great Britain and Northern Ireland, and that we should all benefit from manufacturing, jobs and apprenticeships?

[Virginia Crosbie]

I thank the hon. Gentleman for his kind words. He is absolutely correct. This is a UK-wide endeavour, and it means jobs not only on Anglesey but across north Wales and the whole of the UK. If we do not work together on this, we cannot work to deliver net zero by 2050.

The support of my constituents is indispensable, but it cannot be taken for granted. They have had their hopes raised and dashed again and again. They have endured so much heartbreak and disappointment as successive attempts to get the project off the ground have failed. The civil nuclear road map will have raised their hopes one more time, and I beg the Minister and the Government to do everything they can to ensure that those hopes at last begin to be fulfilled. What can the Minister do to fulfil them? As I have said, we can start by naming Wylfa as the site for a further large-scale project. We should also get the land off Hitachi, and the intellectual property from the Horizon project and into the hands of Great British Nuclear. I will put it simply: the land is designated for new nuclear development. If Hitachi will not use it, it should lose it.

I urge the Minister and the Government to think creatively about what we can do. As I understand it, EDF in the last year has paid £200 million from its nuclear fleet to the Government through the electricity windfall tax. Urenco usually pays an annual dividend to the Government of around £100 million from its uranium enrichment activities. Could that money not be used to buy out Hitachi, get the Horizon intellectual property and get on with the project at Wylfa?

As the Minister will know, I met, invited and personally showed around the leading contenders for a large-scale project at Wylfa: Westinghouse, KEPCO and hopefully EDF. All have said that the work Horizon has done to prepare the site and design a plant would cut the deployment time for a large-scale project at the site. We know that time is money, so getting the land and intellectual property into UK ownership is critical. The next thing is to design and start a process this year to pick up one of those prospective partners to execute a project at Wylfa in conjunction with Great British Nuclear. That can and should be done very quickly.

Westinghouse, KEPCO and EDF are all very well known internationally. They all have large-scale designs in commercial operation that the Government and our regulators can visit. The companies’ records are out there for people to see and scrutinise. Indeed, our friends in Poland have just gone through an extensive process to choose from those three for their first large-scale plant. The Czech Republic has done the same and the Dutch have started the same process. Can the Minister therefore set out how he and the Government can work with our allies?

Offshore Petroleum Licensing Bill

Jim Shannon Excerpts

2nd reading
Monday 22nd January 2024 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to follow the hon. Member for Brighton, Pavilion (Caroline Lucas). While we do not always agree on everything, there are many things that we do agree on. I, too, would like to see the mass scale-up of renewables, but I also want to be pragmatic about where we are, some of things that we need to do, and what the Bill does.

The issue of energy is one that impacts every person in the UK, from the one-bed flat owner to the 200-bed hotel owner. The ability to secure safe and reliable energy is essential, and spiralling costs are having an effect on the day-to-day lives of people throughout the UK.

I think it is important that I make this point and perhaps explain where I am personally on the matter. I grew up, and others in the House are probably the same, in an age of throwing another jumper on. My children used to laugh at the stories I told them of how cold it had to be before the heating was turned on. For us today, it is no longer a laughing matter for many people. My researcher, who owns a modest home, had to put more than £250 of gas into her home in December. She was at home during term-time with the children. She tells me that the gas was not even running constantly; it was turned off whenever she went to visit her parents or her husband’s parents or went out. I thought of how much more a wee—I use that word often in the House as a descriptor—widowed pensioner would be paying in their home when they are there almost all day, every day. That figure is not one that their pension and a single winter fuel payment could cover. There are only so many jumpers that someone can put on, and a jumper does not help with a damp wall.

It is clear that the cost of energy dictates what steps we take to secure the current energy supply, while also striding for new alternative renewable energy sources. As many in this place will have heard me say on numerous occasions, tidal energy in Strangford lough and other such areas needs a great deal of funding. The pilot scheme worked, but it was at the wrong time because the cost of the energy that it produced was not financially feasible, but it would be now. If we can harness that power, which is as reliable as the sun rising in the morning, we are on to a winner. However, I understand that that is not the point of today’s debate and will leave it at that.

The Secretary of State for Energy Security and Net Zero is in her place, and I know the Government have taken giant steps to meet the net zero targets and have committed themselves to green energy. I wish to put on the record that I am committed to the same targets as well, but we need to strike a balance. The balance that I put forward to the House—and I wish to make a declaration—is from my point of view as a farmer. We own land. My neighbours are all dairy men or farmers of beef, cattle and sheep. They are willing to commit themselves to the net zero targets because they see that net zero is something that must be done. As part of that target, they must reduce the number of their animals. That is not possible to do while continuing to have a feasible and financially viable farm. There are other things that the farmers wish to do.

In the countryside where I live there are not enough electric vehicle points, so people do not buy an electric or hybrid car, probably because all the EV points are up in Newtownards. I drive a diesel vehicle—have done all my days and, if I am spared, will probably continue to do so because I believe that it is a choice. It is a choice we may not wish to make every time, but is one that we have to make because electric cars are just not feasible because the EV points are just not there.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Does the hon. Gentleman agree that the National Farmers Union has been positive on many of these issues? Does he agree with what it says about hydrogen being a source of sustainable power in the future, and that it is coming soon?

[Jim Shannon]

I thank my hon. Friend—I call him that because I have great respect for him—and agree wholeheartedly with what he has just said. The farming community, the NFU and the Ulster Farmers’ Union are clearly committed to the targets. They are committed to looking at the alternatives, but the alternatives have to be practical. The point I am trying to make is that it is about where things are practical.

There is no doubt that to meet not just our net zero target but, more importantly, our environmental obligations, we need to do a better job of accessing and using renewable energy fuels. However, the fact is we will simply not be there any time soon and, in the meantime, it is vital that we secure safety and security for our constituents. I support the aims of the Bill, which would enhance the procedures currently in place, and note that no financial hardship should be passed on through the Bill. That is vital as I know that households are struggling with the current pressures. No longer is it a matter simply for households in poverty, working families with decent wages are being affected.

It is a transition. It is about meeting our net zero targets and increasing green energy and renewables, which my hon. Friend the Member for Brighton, Pavilion (Caroline Lucas) referred to. At the same time, the Bill gives us the opportunity to progress those renewables in a way that is positive in the short term.

The Library briefing makes it clear that licensing rounds are run when the NSTA decides they are necessary. However, it should be highlighted that they have been held broadly on an annual basis up to the 32nd licensing round, which opened in 2019. The latest—33rd—licensing round was launched in October 2022, following the introduction of a climate compatibility checkpoint in September 2022. In October 2023, 27 new licences were awarded as part of that licensing round. That is not onerous, but it is necessary not just to safeguard our industry by enhancing investor and industry confidence, as the Government have highlighted, but to ensure that we do not see families scraping pennies together to afford heat.

My contribution to the debate is clearly for those who are in energy difficulties. Today, the papers referred to food bank referrals being up some 30%. The food bank in my constituency of Strangford in my major town of Newtownards saw a 30% increase in referrals over December and early January from people who are middle class who are finding it difficult to deal with energy prices.

I know of several young families who usually enjoy a few days away when the kids are off at Christmas, and they told me that they were just not able to do it this year. People may say, “For goodness sake, they can’t go on holiday…” I am not saying that because it is their right to have that break, but I am highlighting the knock-on effect for families of increased prices is that they cannot afford to sow into the local economy in the way they used to. That means the little 20-bed hotel they usually visit does not get their business. The knock-on effect is that they do not hire the cleaner for as many hours. Her income drops, and she cannot spend the way she usually does, so the knock-on effects continue.

We need the people who spend locally to do so, and for them to do that, energy bills need to be manageable. We are failing when it comes to energy provision. If the Bill helps safeguard our provision as we continue to find better ways to source reliable renewable energy, I support that. When the Minister or Secretary of State sums up, if they could give us that reassurance, I would be a whole lot happier about this debate. Of course, we need to explore tidal energy, but safeguarding domestic production can go hand in hand with that. Indeed, it must do so. I am committed to renewables, green energy possibilities and net zero targets because the farming community that I live in want to commit themselves to that as well.

I support our families, our vulnerable, ill and elderly, and those living in cold, damp homes because they cannot afford to do otherwise. Therefore, at this stage, I support the Bill on behalf of all those struggling to heat their homes and keep their families warm. We must commit ourselves to more renewables and ensure that the renewables percentage rises. If it rises, we can reduce gas and petroleum usage. By doing so, we can balance the process. That is what I am hoping for from the Minister’s reply; I hope we can deliver that.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Before I call the shadow Minister, I want to emphasise again, and I will do so when he has finished, how important it is for those who have contributed to the debate to be here for the wind-ups. I call the shadow Minister.

Oral Answers to Questions

Jim Shannon Excerpts

Tuesday 16th January 2024 Commons Chamber

[Andrew Bowie]

I thank the hon. Gentleman for his question. I hold a contrary position. I am proud of the fact that this country is open to inward investment and, indeed, attracts attention from some of the biggest companies in the world to invest in our future energy security and net zero objectives. Of course, in unveiling all these exciting announcements, as we did last week, at the heart of what we are seeking to achieve is to create those high-wage, high-skill jobs as we move forward across the United Kingdom, building up that supply chain, and tidal will be an important part of the mix as well.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for that most progressive answer. The progress made in nuclear safety and the need for clean energy clearly indicate that the Government must invest in the security of this sector. That would lower energy costs and help us to meet our green targets, which we all want to meet and should meet. Will the Minister outline what progress has been made to secure this investment?

[Andrew Bowie]

As the hon. Gentleman knows, just last week we unveiled our civil nuclear road map. I committed to meet him and, indeed, anybody else from Northern Ireland to seek to build up the manufacturing and supply chain workforce in Northern Ireland, so that all parts of our United Kingdom can benefit from the once-in-a-generation investment that we are making right now.

Civil Nuclear Road Map

Jim Shannon Excerpts

Thursday 11th January 2024 Commons Chamber

[Andrew Bowie]

Again, I welcome my hon. Friend’s support and I thank him for hosting me on a visit to Dungeness—the fish and chips were exquisite. I agree that we will look at every site and possible site and judge them on the basis of what type of technology could be built there. That will benefit his community, communities around the country and the United Kingdom more widely.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for his statement. It is great that the Government have outlined plans for the biggest expansion of nuclear power in 70 years to reduce energy bills, which so many of our constituents struggle with on a daily basis. Minister, I ask you this question because you admitted that Northern Ireland—

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. The hon. Gentleman knows that he should not refer directly to the Minister. Let us have another go.

[Jim Shannon]

Apologies, Madam Deputy Speaker. What provisions does the UK civil nuclear plan include to involve Northern Ireland? How will it ensure that the region’s perspectives and concerns are adequately taken into account in the development and implementation of nuclear politics and policies, so that we can create jobs and strengthen our economy at the same time as other areas in the United Kingdom?

[Andrew Bowie]

As ever, the hon. Gentleman champions his constituents and the people and economy of Northern Ireland. It is essential to me that every part of our United Kingdom benefits from this once-in-a-generation investment into new nuclear. I would be delighted to meet him to discuss how Northern Ireland and his constituents in Strangford could benefit from investment in skills and the supply chain. Deployment of nuclear capabilities is a devolved competency, but I would be happy to meet him to see what his constituents can get from this historic announcement.

Tidal Range Energy Generation

Jim Shannon Excerpts

Wednesday 10th January 2024 Westminster Hall

[Mick Whitley (Birkenhead) (Lab)]

I beg to move,

That this House has considered tidal range energy generation.

It is a pleasure to serve under your chairmanship, Dame Caroline.

The UK, more than any other country in the world, is uniquely positioned to harness the power of its tides. Ten per cent of the world’s tidal resources, and half of Europe’s, are found in Britain. Already well-developed plans for tidal range projects across the west coast promise to mobilise and deliver 10 GW of net zero energy, with the potential for 10 GW of additional capacity—enough to meet approximately 12% of the UK’s electricity needs over the coming decades, when, as a result of our efforts to decarbonise transport, heating and industry, demand for electricity is set to more than double.

While I want to approach this debate constructively, the Government’s ambition in supporting the development of new tidal range projects has been sorely lacking. Tidal range technology was excluded entirely from the Energy Act 2023, and the one reference made to tidal power in the 2022 energy security strategy—a commitment to “aggressively explore” the possibilities of tidal power—has not been delivered on. Although we see encouraging steps in the right direction, including moving towards the inclusion of tidal in the national policy statements on energy and the publication of guidance on tidal range on 18 December last year, much more still needs to be done.

In his correspondence with me dated 26 October, the Minister for Energy Security and Net Zero, the right hon. Member for Beverley and Holderness (Graham Stuart), stated that

“the government remains open to considering well-developed proposals for harnessing tidal range energy”,

but that

“any such proposal would need to demonstrate strong evidence of value for money in the context of other low carbon technologies.”

The issue of value for money has long been cited as the main obstacle to unlocking the potential of the UK’s vast tidal resources. Indeed, when the then Secretary of State for Business, Energy and Industrial Strategy declined in 2018 to provide the proposed tidal lagoon project on Swansea bay with the price stabilisation mechanism that was needed to guarantee investor certainty, it was on the grounds that the levelised cost of energy was higher than that of low-carbon alternatives, including new nuclear.

[Jim Shannon (Strangford) (DUP)]

I support the hon. Gentleman in bringing forward this issue, which is really important for my constituency of Strangford. He has given the example of Swansea. Strangford lough has obvious potential for a tidal stream, which is why there was a trial there in 2008 with SeaGen. I was a Member of the Northern Ireland Assembly at the time. It was a successful pilot scheme but did not seem to go any further. As energy prices have risen, the possibility of a new scheme is even more likely. Does the hon. Gentleman agree that the devolved Administrations have a role to play in developing tidal stream and tidal range, which the Government should utilise so that we can all play our part in tidal energy?

[Mick Whitley]

Yes, I do. There are more examples of tidal energy to come. If the Government take cognisance of the points being made in today’s debate, hopefully some progress can be made.

The former Secretary of State’s decision was met with incredulity by many figures in the industry, coming as it did only 18 months after Charles Hendry’s independent review found that tidal lagoons could

“play a cost effective role in the UK’s energy mix”

and constituted

“an important and exciting new industry for the United Kingdom.”

In retrospect, and particularly in the light of the conclusions of the study undertaken at the University of Birmingham in 2022, which found that the Swansea tidal lagoon would have returned profits to the low-carbon contract company, the Government’s decision not to provide support for the Swansea bay project seems to have been seriously misjudged. It has deprived us of a credible pathfinder project of the kind advocated by Charles Hendry’s review.

However, I have not called this debate simply to revisit debates from a long time before either the Minister or I had entered Parliament. Today is not about looking backwards; it is about facing the future, and asking what we can do to guarantee our energy security in a time of growing geopolitical uncertainty and climate breakdown, and the role tidal range generation has to play in that process. In that vein, I ask the Minister and his colleagues to recognise that the fundamental question of value for money needs revisiting.

Principally, that means adopting a whole-systems approach when assessing cost-effectiveness. The levelised cost of energy can be a useful tool, but it can also be a blunt instrument when it comes to gauging the comparative costs of renewable and low-carbon energy sources that fails to take into consideration the additional costs of solar and wind generation caused by grid transmission constraints, rebalancing and storage.

It also fails to account for the fact that, uniquely for a renewable, tidal energy is a timetabled predictable resource, giving it an important role to play when seasonal factors interrupt supply from solar and wind. In my previous engagements on this issue, I have made the case that when a whole-systems analysis is made, the costs of tidal power are comparable to offshore wind and new nuclear.

I am sure the Minister will take great interest in the research currently being carried out by Jacobs for the British Hydropower Association, soon to be published, which confirms that analysis.

Grangemouth Oil Refinery: Energy Security

Jim Shannon Excerpts

Tuesday 9th January 2024 Commons Chamber

[Kenny MacAskill (East Lothian) (Alba)]

“Bathgate no more, Linwood no more, Methil no more, Irvine no more” sang the Proclaimers as they detailed the devastation caused by industrial closures and the hardship and emigration that followed. That was in the 1980s as Thatcher mercilessly shut the pits, decimating Scottish industry. Not just the many individuals who lost their jobs, but entire communities and the whole country suffered as de-industrialisation took root. The country has recovered but much has still been lost and for some it is irrecoverable, irreplaceable, or both. Scars remain and pain runs deep. The devastation will neither be forgotten nor forgiven. But is there now to be a new line of “Grangemouth no more”?

Scotland’s oil refinery stands threatened. Its closure would result in the perversity of an oil-producing nation lacking refinery capacity. I asked the House of Commons Library for research on oil-producing nations and refinery capacity. There are few nations which are oil producers yet lack refinery capacity. Norway has two refineries, and of those nations which lack a refinery capacity none are in the top 25 oil producers, as Scotland is. Instead, they are countries which neither produce as much oil as Scotland nor even have a developed economy. They are largely developing nations such as the Congo or Trinidad and Tobago, not a developed and industrial land like Scotland, which now faces the absurdity of being a major oil producer yet lacking refinery capacity.

If closure proceeds, Scotland will be getting treated like a developing nation: its raw product taken for a song and then sold back as a refined product, but at a premium to people and nation. Exploitation is what it is called. The Rosebank field and the North sea are to be the saviours of the UK economy, yet Scotland is to lose its refinery and face social and economic hardship as a result. Exploitation is what it is. That is what we will inherit if action is not taken.

Oil was first discovered in the 1960s and it would have made Scotland one of the wealthiest countries in Europe, but it was deliberately hidden from the Scottish people. That was to downplay expectations and diminish ambitions. Norway across the North sea has been transformed socially and economically by its oil resource, with a standard of living that Scots can only look at with envy and a sovereign wealth fund that Scotland can only dream of. Yet Scots have continually been told that the resource would soon be gone, and in 2014 at the referendum it was not just running out but even an impediment, a drain on an independent Scotland. Yet now it is at the heart of the UK’s economic recovery.

Although it has been rediscovered, what is in it for Scotland? As has been said, some nations discovered oil and made the desert bloom, but Scotland discovered oil and is seeing an industrial desert created in so many of its communities, and one could well now be Grangemouth. It is not just absurd but perverse that an oil-producing nation should have no oil refinery capacity. It is more than an economic argument; it is vital for economic security. War in Ukraine and conflicts in the middle east have shown the consequences. In the world in which we live, energy is essential and securing all aspects of the supply chain is common sense.

Let us look at the economic arguments and consequences of any closure. The loss and hardship would be significant for thousands, not just hundreds, sending shockwaves through industrial Scotland. The plant’s workforce is 500 but there are also some 2,000 contractors attached to it. Moreover, they are skilled jobs and their loss, as with past industry closures, will impact on future generations. Not only have current and past generations benefited from working there, but numerous apprentices were trained there, even if ultimately plying their trade elsewhere. We already have a skills gap; this would worsen it considerably.

Job losses would be significantly higher than those simply at the site. Closure would reverberate across industries clustered nearby because of the refinery. If it closes, many of them will also be lost. They are in a variety of sectors, whether chemicals, plastics or other fields. That is without even considering the huge number of individuals who depend on the site whether for their corner shop, as drivers or in other trades, both locally and from more distant parts. There is always a multiplier effect in any redundancy but, given the pivotal nature of the industry to the country’s economy and its impact across a swathe of sectors, it would be huge. Both the town of Grangemouth and all of Scotland would suffer. The knock-on effect would echo across the entire country as industrial closures did decades ago, whether the pits or car plants.

Grangemouth’s refinery is a national asset upon which our energy security and industrial economy depends. That is why it must be retained. There has been a refinery there for a century. It currently provides 70% of Scottish filling stations, as well as many in northern England. It is also the primary supplier of aviation fuel for Scotland’s airports—not an insignificant issue for an island nation with many remote island communities. As I have stated, energy security demands it.

We are seeking to transition from a carbon economy, but it must be a just transition and at a pace allowing our economy and society to adapt. The cumulative impact of closure might not be the 4% loss of GDP suggested by Petroineos, but even the 0.25% or 0.3% loss of GDP suggested by the Fraser of Allander Institute would be damaging enough. Where is the outrage and anger? Where is the ministerial statement here at Westminster or the call to action at Holyrood? Instead, there has been silence or sanguinity, hope that it just might not happen or, even more disgracefully, quiet resignation to its fate.

Thankfully, Unite the Union and the workforce are strenuously making the case, and I am grateful for their assistance and input. Closure is still only potential rather than actual, but the threat is real, and there has to be a balance between causing unnecessary alarm and taking urgent action. Unless action is taken now, disaster will befall Grangemouth refinery and the impact will be grave upon all—workers, the wider community and the entire nation.

What needs done? Ownership has changed over the years, and profitability has been affected by under-investment. No blame can be attached to the current or past workforce. Responsibility may also rest with previous owners other than PetroChina and INEOS, currently in charge. Steps can and must be taken to address the current profitability and buy time so that a transition can take place both at the site and across our economy. Moreover, there are also actions that will increase capacity and thus profitability and productivity. That means linking Scotland’s oil refinery with Scotland’s oil production. Finally, there is the just transition and the need to prepare for the new world. That can and must be done at this site.

Let us examine those three aspects that must be done. First, there is the need to fix the hydrocracker at the refinery. Its current inoperability is impacting on profitability. Restarting it would increase profitability threefold. That is significant, and would allow an extension of life at the plant, even without any additional steps being taken. It is estimated that it would cost between £60 million to £80 million to do so, but it must be done. The money must be found, whether from Westminster, Holyrood or the existing business. Surely, from all three, finance can be found. It is a small cost for such a huge asset that is essential to not just our economy but our society. After all, there is a moral as well as a financial economy. The price must not be paid by the individuals and communities who would suffer from its loss.

As well as restarting the hydrocracker, there should be an increase in capacity and in what is refined. It will surprise many that North sea oil is not refined at the Grangemouth refinery, despite the pipeline for the Forties field coming ashore at Cruden bay and being pipelined on to Grangemouth. Almost all the product refined at the plant is brought in on tankers from elsewhere. It comes in on ships and goes away in trucks. Meanwhile, North sea oil is transported to other refineries, whether in the UK or abroad. That must end. It has always been absurd, but now it is criminal. Oil from the Forties field pipeline, which last year moved approximately 40% of the UK’s oil from the North sea, must be refined at Grangemouth. It requires technological and engineering changes, but they must be made. As Rosebank comes on stream, and as the Forties continues to flow, refining must be at Grangemouth. Scotland is entitled to expect no less from its resource.

The Prime Minister has trumpeted the necessity of continuing to exploit North sea oil, and while I can take issue with the extent and pace of it, I agree with the logic. It is absurd to import oil when we have our own resource. Not only is it economic self-harm, but it is environmentally daft to transport it across the seas when it is off our shores. Why spew out the significant fumes of a supertanker by the hundreds of thousands when we can pipe the oil ashore? To achieve that requires ensuring that the oil is refined here, which it currently is not.

The hypocrisy of the Prime Minister’s position has been exposed by those who oppose development. Their arguments have legitimacy unless steps are taken to ensure that the resource is refined here, rather than having the environmental double whammy of transporting our product far away for refining and then having those ships cross with others importing refined product from elsewhere. The Forties field oil supply must be refined at the site, and the technical and engineering work to achieve that must be done. It is bad enough that ownership of the Rosebank field lies with the Norwegian state energy company, but to have that product refined abroad compounds the agony and the absurdity.

Finally, there needs to be preparation for the transition from fossil fuels to renewables. Steps must be taken to prepare the site for biofuels, which will be required in the future. The sites to refine them need to be established. It makes sense to secure the short-term future of the site by restarting the hydrocracker. Similarly, extending the refinery’s capacity by ensuring that North sea oil is processed there is essential. Steps need to be taken towards that transition, which humanity is required to make for the sake of life itself, not just the planet. But it must be more than just warm words and empty rhetoric; it requires preparation and action. Making Grangemouth a future site for biofuels refining must be part of that.

In summary, securing the refinery is essential for Scotland, not just Grangemouth. The arguments for it are social, economic and environmental, and the case is overwhelming. It is simply perverse that an oil-producing nation should have no refinery capacity, or that an industrial desert be created where a natural bounty should see a country and its communities bloom. It is for those reasons that I ask the Minister to meet me and workers’ representatives from the site. Additionally, and most essentially, will he ensure that these three steps are taken? First, will he ensure that funds are found to restart the hydrocracker? Secondly, will he ensure that oil from the Forties field that is piped to Grangemouth is refined there, and that oil from new developments such as Rosebank will also be refined there, negating the environmental harm of the trans-shipment inward and outward of oil?

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Gentleman for bringing this debate forward. Does he agree that the East Lothian oil refinery at Grangemouth is a necessity not only for Scotland, but for all the United Kingdom? It must stay open not in opposition to renewable targets, but in partnership with them.

[Kenny MacAskill]

Yes, I agree with that.

My final point is that as we transition, we must ensure that actions are taken at the site for that new future by ensuring a biofuels capacity there. We simply cannot have the absurdity of an oil-producing nation lacking a refinery capacity, never mind the perversity of the oil it produces being shipped across the seas for refining.

COP28

Jim Shannon Excerpts

Thursday 14th December 2023 Commons Chamber

[Graham Stuart]

I am grateful to the hon. Gentleman for his question, which, as ever, is well informed and extremely reasonable. He is absolutely right. I visited the port of Nigg. I was interested to see nascent floating offshore wind work, fixed-bed offshore wind work and oil and gas work, and I wandered into a hall where they were making a large and sophisticated piece for Hinkley Point C, extraordinarily. That was all at Nigg.

The hon. Gentleman gets to the point about financing and whether the auction, which has been brilliant at lowering prices, has in fact helped drive too much of the industry out of this country. Behind the day job of transforming our generation, my passion will be to see how, without following some others with WTO-breaching local clauses, we can nudge and support more industry here. That is why we are bringing in sustainable industry rewards—non-price factors, in the jargon. We expect those to come in from allocation round 7 onwards as we work to make sure that we look after consumers first, while not missing any opportunity to utilise, maintain and grow jobs here. On offshore wind alone, our expectation—this is what the industry says—is that we will go from around 30,000 jobs in the industry today to more than 100,000 in the next six years. One of our biggest challenges is finding those people, training them and making sure we are ready to deliver them, as much as it is having more done here.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister very much for the positives in his statement and the significant targets that the United Kingdom of Great Britain and Northern Ireland is setting to achieve our goals. Some of the figures he has referred to are encouraging. I wholeheartedly support help for poor countries, as he will be aware. Will he outline the parameters of the loss and hardship fund that has been mentioned as they pertain to ensuring that the fulfilment of human rights obligations is in the requirements for any award?

[Graham Stuart]

I thank the hon. Gentleman for his as ever gracious question. One of our disappointments—there were things we were disappointed with in the UAE consensus—was the watering down of elements we would have liked to see on human rights. He is right to highlight that. We have always wanted loss and damage to focus on the most vulnerable. The least financeable of all are people in an already parlous economic position, often at low scale, who are under threat from climate change. We hope that the funding that has been created for loss and damage can complement adaptation funding as well as mitigation work, and have climate justice at its heart. We have to look after the weakest and poorest on the planet. However unsympathetic the science, we have to ensure that policy recognises the realities for people all over the world.

Energy Costs and Charges

Jim Shannon Excerpts

Tuesday 21st November 2023 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Gentleman for bringing this debate forward. He is making a compelling case for Scotland. May I suggest to the Minister that there is also a compelling case for Northern Ireland? We have not had the opportunity to advance to the same level as Scotland, but we wish to do so. Does the hon. Member for East Lothian (Kenny MacAskill) agree that if we are to move forward, there has to be a joint strategy for all of the United Kingdom of Great Britain and Northern Ireland, because we can and must all play our part? I envy what Scotland has done. We in Northern Ireland want to do the same.

[Kenny MacAskill]

Well, I prefer an independent strategy, similar to what Norway and Denmark are doing, but I concede that Northern Ireland is frequently ignored because so much of the gas grid is pan-Great Britain, rather than across the Irish sea.

Let us look at how Scotland’s resource is pooled and shared. I have detailed the 35 TWh rising to 124 TWh, but I have not explained that no payment is received for that resource. The energy is sent south, but there is no financial return to Scotland. Besides nothing being paid for it, there are now efforts to take it directly south with neither a bawbee nor a pretty please being given for it. Off south it is to go, and for no payment.

The Eastern HVDC—high voltage direct current sub-sea—transmission cables, also referred to as the Eastern Green Link projects, are the longest HVDC cables to be laid in the UK and will run from Peterhead to Redcar and from Torness to Drax. It is estimated that those links will take 5 TWh, or 5 billion kWh, of Scotland’s renewable energy source south, again with no payment. Additionally, the proposed Berwick Bank offshore wind farm in the firth of Forth will alone produce sufficient energy to supply more households than Scotland possesses, but a cable is proposed to be laid to take 40% of its energy directly south, again with no payment.

What about the sharing? Where is the benefit from the supposed broad shoulders of the Union? Where is the return for what we contribute? A recent question to the now Department for Energy Security and Net Zero asked whether consideration would be given to crediting domestic energy users in the localities where energy is produced and landed. After all, it is being produced onshore or offshore in Scotland, so we might have thought that some credit or benefit would accrue to Scotland, and it might even be cheaper there. But no—the answer was simply that it is a matter for Ofgem, which we know is a creature of statute and can act only within its set powers or as directed by Ministers. No such rules exist and no direction has been given. The energy is not only to go south for no payment, but no benefit is to accrue to Scotland from it.

There is talk of payments to those facing having pylons placed near them, but what about those who live in the land where the energy is being produced? Winter will soon be upon us. The weather is changing and the temperature is falling. The cold is being felt and the need to heat homes is increasing, but it is not simply heat but power that is required. Energy, and especially electricity, is needed not just to keep the cold at bay. It is required by the mother to wash her children’s clothes, keep them clean and uphold the standards she seeks to maintain. It is required by the parent seeking to power up an iPad or laptop to help their child’s education and advance their life chances. It is required by the worker charging their phone to allow them to find employment or do the additional hours that the Government want, or simply to keep body and soul together. More shamefully, it is also required by the sick, including those on dialysis and those recovering from cancer, whose immune systems are weakened and for whom warmth and power are a necessity for life, not a luxury for living.

Despite the fact that Scotland is energy rich, our people are fuel poor. Already more than a third of Scots have been assessed as being in fuel poverty. Even more shamefully, almost a quarter are in extreme fuel poverty.

COP28

Jim Shannon Excerpts

Thursday 16th November 2023 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to follow the hon. Member for Putney (Fleur Anderson). She may be disappointed by what she hears from others, but she never disappoints with what she says in this House. We were in Pakistan back in February. We have an interest in issues relating to persecution and freedom of religious belief, and in how we can help through work on human rights. She is experienced and knowledgeable on the subject of water, and we visited some encouraging projects, but we were reminded of the impact in parts of the world where, unlike here, water is a scarce commodity.

I am very happy to speak in the debate, and I cannot believe it is again time for the annual COP meeting. This year it is in Dubai, where I am sure the weather will be much better than in the UK, given the storms we had recently. This year’s cross-cutting themes aim to address our main targets: technology, inclusion, finance and front- line communities.

It is great that we have the opportunity to discuss these issues. It is always a pleasure to provide a Northern Ireland perspective in debates in this Chamber and elsewhere, so that we have a united and joint approach to our climate change and net zero targets. It is also a pleasure to see the Minister in his place. I was encouraged by some of the things he referred to, such as the targets met and the goals achieved. I believe in giving credit to those who do well. At the same time, if targets are not met, then we challenge. Let us put on record our thanks where goals have been achieved. It was also a pleasure to hear from the Labour shadow Minister, the hon. Member for Bristol East (Kerry McCarthy), and the SNP shadow, the hon. Member for Edinburgh North and Leith (Deidre Brock). They made valuable contributions, as others have.

I declare an interest as a member of the Ulster Farmers’ Union, because I will speak about agriculture. Across the world, we have fires, floods, droughts and tsunamis. Those things do not just happen; man and woman have a role to play in the world in which we all live. Nature, I would suggest, is angry. It is nature’s way of reminding us that what we do has repercussions.

To go back to Northern Ireland, it is no secret how crucial our agriculture sector is. I live on a farm. All my neighbours are farmers and most of them are dairy men. Farming is the largest emitting sector in Northern Ireland, contributing some 27% of emissions—and that increased over the 30 years covered by the statistical bulletin to which I refer. The Government, the Ulster Farmers’ Union and the National Farmers Union have committed to reducing those emissions, and it is important that that happens. It is no secret how challenging it is to cut emissions. Large organisations such as the Ulster Farmers’ Union and the NFU have had to cope and adapt in a short space of time, so it is promising to see that COP will address that this year. It is important that that happens.

On 10 December, the theme for the day will be food and agriculture. The aim will be to address innovation investment, regenerative agriculture and national transformation. That is a positive sign that our agricultural industries are being given the means of contributing to climate targets. At the Democratic Unionist party conference about a month ago, the UFU had a stand, and it has a paper on how to achieve net zero targets. Be under no illusion: farmers, landowners, my neighbours and the unions are totally committed to doing their bit to achieve climate targets. There is definitely a clear, central role for farmers.

Many comparisons can be made between the state of our climate and prevailing health issues across the UK and further afield. As my party’s health spokesperson, I am greatly pleased that health issues will also be addressed at COP. It looks like a terrific conference, and there are lots of key issues on the agenda that I would like discussed.

I have been in contact with organisations about the clean air programme, which is tackling the air quality issues facing us all. For the first time at a COP summit, a full day’s agenda has been devoted this year to initiatives designed to

“protect livelihoods and support community resilience and stability”

in the face of the advancing effects of climate change. While some may say that there is no such thing as climate change, the facts—the evidence that we all have in front of us—tell us that there is, and that something must be done about it. There will be high-level discussions about the importance of clean air, which has been proven to lead to improvements in both mental and physical health.

Some three weeks ago, I spoke in a debate about circular economies and their importance in our local communities. Ards and North Down Council, which covers the area in which I both work and reside, has a proven commitment to acting sustainably to create a vibrant and healthy economy. Recognising the contribution that local councils and devolved Administrations can make to net zero targets across the UK is perhaps the smallest but most important step to take in regulating environmental sustainability. The Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly all have a key role to play. We all play that role in our own places, but when we all come together, it is the teamwork that delivers. Whether we discuss these issues at events as large as COP or more internally back home in local council chambers, we will never progress without having the conversations. It is great, and commendable, that efforts in that regard are being made at all levels of government.

I look forward sincerely to hearing the comments made at COP28, and not only from the perspective of the United Kingdom of Great Britain and Northern Ireland. Again, it is no secret that I love this United Kingdom of Great Britain and Northern Ireland, and I believe that it is better together. Some may have a different opinion—at least one Member who is in the Chamber now, perhaps—but the rest of us are committed to the importance of that. When it comes to looking further afield and globally, the United Kingdom of Scotland, Wales, England and Northern Ireland, as well as all the regions, has a part to play—at all political levels: council, regional, and Westminster. COP provides an opportunity for a joint and united approach to meeting our targets, and that is something that we have to achieve. There are no “ifs” about it; there are no questions. We must ensure that efforts are made in this place to achieve those goals.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the Minister to wind up the debate.